EVs for Everyone, Better Batteries :: F, GM, TSLA :: Revisited

 Guess when this was written: 

“Now there's a growing demand for electric car batteries. With GM, Nissan, Ford, and Tesla ramping EV production, battery usage in electric cars could begin to drive a meaningful segment of the battery market. As a result, a number of improved battery designs are being developed in laboratories, involving silicon, graphene, and a zinc-air composition to name a few.”

The above is not an exact quote, there are a few tweaks (removing vehicle introductions) so the answer was not too obvious. Drumroll please... This was written on April 12, 2013. 

Even though this is 10 years old, it reads like an article written today. There has been a massive amount of investment into battery research and manufacturing over the last decade, but the demand has been outgrowing the supply. 

The above quote came from The Motley Fool's blog site, but you can no longer find it there. Luckily the Wayback Machine still has an archive of it. Full credit to the author, Alexander MacLennan aka TulipSpeculator1, for spotting this trend so far before it was apparent to everyone.

Why does this matter? The goal is EVs for everyone, whether it's personal vehicles, public transportation, or rideshare; with all of this powered by renewable electricity. However, there are a couple obstacles. 

Why Are EVs Expensive? Batteries! 

EVs have far fewer parts than internal combustion engine (ICE) vehicles. This makes EVs quicker to build; making EV automobile factories more productive.

EVs are easier to design, you don't have to plan around transmissions, drive shafts, large engines, fuel lines, fuel tanks... 

So if EVs have fewer parts and the factories are more productive, why are EVs more expensive? The batteries. Today, batteries are the most expensive component in most electric vehicles, but there's good news on this front.

Battery Prices are Dropping 

The good news is that battery prices are dropping. 

You can see on the graph above, from 2010 to 2020 EV battery prices dropped by over 88%. This is a huge change. This is what allowed Tesla to move from selling $100k Model S and X to selling Model 3 and Y at about half the price, while still making a profit.

This trend is what will allow EVs to become more affordable and replace the vast number of gas vehicles on the roads over the next decade. 

Boom and Bust

Unfortunately, 2022 looks like a year that will not continue this downward battery price trend (as I write this, final numbers are not yet available). The legacy automakers have woken up to EVs; they will not cede the electric market to the upstarts. So now they are trying to ramp up their EV production volumes. This has meant increased competition for battery factory capacity, resulting in price spikes throughout the battery supply chain, from raw materials, to refined materials, to finished goods. 

Here's a chart showing EV sales. Each one of these vehicles has Lithium-ion batteries. Most of these vehicles have thousands of pounds (and thousands of dollars worth) of battery cells.

Via @skorusARK

This increased price does have a silver lining. This price spike will draw in more investments, the production capacity will grow, and then battery prices resume their downward price trend, but now with more production than ever before.

Better Living Through (Battery) Chemistry

Battery technology has been improving each year by 5 to 7 percent. This is true for cutting-edge battery chemistries, but it's also true for older battery chemistries. 

More research funding than ever before is going into battery technology. This includes research into Lithium-Air, Lithium-Sulfur, and solid-state batteries to name a few. One of these might turn out the be the battery of the future, but today there are two general categories for high-production Lithium-ion cells. These are Iron-based chemistries such as Lithium Ferrophosphate (LFP) and Nickel-based such as Nickel Manganese Cobalt (NMC) and Nickel Cobalt Aluminum (NCA).

Each manufacturer has their own twist on the recipe with different dopants, membranes, electrolytes, and the like. But to stay competitive, any advancement made by one will be answered with an analog by the others. 

Most EVs today are made with Nickel-based Lithium-ion battery cells. However, Iron-based batteries are lower cost, have high safety, low toxicity, long cycle life, and more heat tolerance. If Iron-based batteries have all of these advantages, why are Nickel-based batteries currently dominant in the EV market? The answer is weight. 

Paying The Iron Price

Iron-based Lithium-ion batteries are heavier than Nickel-based batteries per unit of energy storage. When the batteries are used in a mobile device (like cars or smartphones), this additional weight is a problem. Heavier batteries take more energy to move, which requires more batteries... this negative feedback cycle limits the practical range of an electric vehicle that is powered by Iron-based batteries.

Improvements to Iron batteries are slowly unwinding this negative feedback loop. Lighter Iron batteries (improved gravimetric energy density) are allowing these batteries to be used in vehicles with a significant range. For one example, Tesla makes a Model 3 Standard Range Plus variant that uses Iron-based Lithium-ion cells in its battery pack. This car has a range of 253 miles. A 253-mile range EV can fulfill many people's driving needs.  

Iron-based batteries are also finding their way into utility-scale storage and backup power applications. For these stationary use cases, the heavier weight is not a significant penalty. But, more importantly (from the EV perspective), this means the Nickel-based cells (that were once used in these stationary applications) are now available for long-range EVs.

Today, Iron-based cells are about a quarter of the battery market and their share is growing. Iron cells are expected to be about half of the market by 2028. This will help make EVs more affordable.

Closing the Loop

The other mega-trend that will help bring EVs to all is recycling. Today, Nickle, Lithium, and other materials must be mined to make batteries for EVs. The good news is that the packs in each EV that going onto the roads today will be able to be recycled into new batteries. Unlike gasoline cars that have an unquenchable thirst for drill baby drill; EVs will reach a steady state.

One of the best aspects of recycling is that it can be done locally. Today, the materials in EV batteries make the equivalent of several trips around the world before being delivered to a final customer. Battery materials recyclers, on the other hand, will be located near battery manufacturers. Reducing these material road miles will reduce the price of new batteries.

 

Better Batteries: The materials in EV batteries are highly recoverable. Two things to consider: one, the average lifespan of a vehicle is 12-14 years; two, EV batteries have been getting better by 5% to 7% each year. Adding these two together means that when an EV that's seen a dozen years or more gets recycled, the materials in there will be able to power ~two similar range new EVs. Batteries that use half the amount of materials will cost less. 

When there's a river of end-of-life EVs coming off the roads, recycling this high-grade material will be cheaper than mining virgin raw materials. This will further help drive down EV prices. This provides a positive feedback loop: more EVs on the road, supplying more recyclable materials, making EVs more affordable, which puts more EVs on the roads. This is how we get to "EVs for Everyone." 

fin

2023 Tesla's Two Million Vehicle Year!

Last year, we wondered if Tesla would be able to produce 2 million vehicles in 2022. Our determination and that it wouldn't happen in 2022. Tesla's final production number for 2022 was 1.369 million. 

Now we're asking the same question for 2023 and it's a real possibility for 2023. 

Tesla's Guidance 2.05 M

Tesla's general guidance is for 50 percent growth. Applying this to guidance to last year's number is 2.05 million vehicles. 

Exponential Growth 2.18 M

Looking at the chart above, plotting an exponential growth model on it and the forecast is production of 2.18 million. This is 130,000 more than Tesla's guidance. 

Linear Growth 1.86 M

Tesla is NOT in the linear growth phase, but this will provide a floor for a bad year. The result is a forecast of 1.86 million vehicles. 

Other Factors

Both Gigafactory Austin and Gigafactory Berlin will be ramping production this year. 

To truly model this in detail, each of the production lines would need to be modeled. The mature lines would have little to no growth; whereas the new production lines will be growing significantly. 

The last few years have been a mess. Supply shortages, pandemic shutdowns... there's no guarantee that this year will be any different. A new variant could pop up and cause similar problems or another force majeure event could occur; so as we often say here, the only thing we know for sure is that there will be plenty of twists and turns. 

This is the year the Cybertruck is expected to start shipping. Trucks are the best selling vehicle in the US. Production could mean a big bump in sales. How fast Tesla can get to volume production will be a significant factor. 

Semitruck: Tesla has begun shipping their Semi. Each one has about a dozen car's worth of battery cells. If there's a cell shortage and Tesla has Semi delivery commitments, this could impact Tesla energy products or in the unlikely worst case, vehicle production. 

Wrapping Up

We've generated estimates from 1.86 million to 2.18 million. Will this be the year of 2 million vehicles or will they just miss it the same way that 2021 just missed the 1 million mark? We shall see. After the world of craziness of the last few years, I think we've earned a calm year of steady growth and that results in Tesla nailing their guidance at 2.05 million. 

Disclosure: I am long Tesla

Energy Portfolio - Solar, Wind, & Batteries

“Don't put all your eggs in one basket.”

That ol' phrase is good advice for many things in life. One example is investing. A mutual fund is a basket of different stocks. This is safer than owning just an individual stock. To be even safer, you could hold a combination of stock mutual funds, bonds, and cash. If stocks are down, maybe bonds are up. If both are down, well at least you still have the cash. But this is not a financial blog and that's not financial advice, so let's move on to our usual topics EVs and Energy. 

This same diversity of assets lesson is now being applied to renewable energy. 

Oregon Public Broadcasting (OPB) reported that Portland General Electric, the largest utility in Oregon, is building a large-scale wind, solar, and battery facility.

OPB says, “Nestled in the hills of Morrow County, hundreds of solar panels and wind turbines are generating a product that will soon be in high demand around the state — clean electric energy.”

This is the diversified energy portfolio: solar, wind, & batteries.

Wind: Morrow County, Oregon is near one of the best windsurfing regions on the continent in the Columbia River Gorge.

Sun: Morrow County is also in the sunny eastern part of Oregon (really, it's not all rainy there).

Batteries: The 30 MW/120 MWh of batteries here will absorb the surplus energy when the sun and/or wind are making more than the grid needs. And it will fill in the gaps when the wind dies down or clouds pass over.

The goal is to have this site supply renewable energy 24 / 7 / 365.

With renewable energy, just as with investing, if reliability is your goal, diversity is a good thing. This is an energy portfolio of solar, wind, and batteries. Continuing the investing analogy, you can think of the solar panels as stocks, they are great when the sun is shining. The wind turbines are like bonds, they're not as sexy, but they are less volatile and often perform when stocks/solar don't. And finally, we have batteries, they are like cash-on-hand, you know exactly how much you have and you can save it or spend it as needed at your discretion.

Ok, enough for the finance talk. Solar, wind, and batteries complement each other well. The solar panels will generate energy during the day and (of course) nothing at night. This generally scales well with increased daytime energy use. Solar also scales seasonally with more generation in the summer when the air conditioners are humming. Solar production is significantly diminished in the winter up here north of the 45th parallel; however, this is when the winds tend to really blow. And finally, you have batteries to fill in the gaps and absorb the excess.

A surprisingly small amount of energy storage (batteries) will make a big impact on the grid; this will be a game-changer for renewables on Oregon's grid. Batteries are what changes renewables from a volatile source that spikes the grid with power one moment, then little to none the next moment, to something that the grid can use to add stability. Batteries are instantly dispatchable. I call this digital energy.

Managing batteries is a new challenge for electric utilities. There are lessons yet to be learned. Such as where's the best place to physically locate the batteries? Is it at the generation location (as in this facility) or should the batteries be closer to the consumption location? Or some combination?

Oregon's last coal plant closed in October 2020. This new installation is about 30 miles from the shuttered coal plant. My favorite part of this story is that the transmission lines that once carried the dirty energy from the coal plant will now transmit renewable power from this renewable energy farm.

Right now, we have the technologies that are needed to move to a future free from fossil fuels. We don't have to wait for fusion or some other big breakthrough. Let's put the resources that we have, here and now, to work. Most deployments are held back by a lack of political willpower, not a missing technology. 

Here in Oregon, we have the political will, and our major electric utilities are required to move to emission-free generation. The Clean Energy Targets bill (HB 2021) requires utilities to reduce emissions as follows: 

• 80% below baseline emissions levels by 2030
• 90% below baseline emissions levels by 2035
• 100% below baseline emissions levels by 2040

That means the generation that's born about a generation from now might be referred to as the clean-generation generation.

#ElectrifyEverything
#100PercentRenewable
#FutureFreeFromFossilFuels
#KeepItInTheGround

Oregon Joins West Coast Gas Car Ban

In 2035, if you want to buy a new car to drive from the Space Needle to Crater Lake to the Golden Gate Bridge and then to Rodeo Drive, that road trip will be in an electric car. 

In December of 2022, Oregon was the final of the west coast three to ban the sale of new gas-powered vehicles in the state in 2035. 

This unites the west coast in banning the sale of gas-powered cars in the middle of the next decade. California was first to announce their ban in August of 2022. Washington state followed suit two months later with their own ban. Keeping the beat, two more months later the Oregon was the last domino to fall on the west coast of the lower 48.

The Oregon Environmental Quality Commission voted to approve the Advanced Clean Cars II Rule at a special meeting December 19th. The rule is based on vehicle emissions standards initiated by California.

The ban will not affect cars already on the road or the purchase of used gas-powered cars but will require those interested in purchasing a new gas-powered vehicle to take their business outside of these states.

 

This is the next step in Oregon's journey. In 2020, Governor Brown signed Executive Order 20-04 which directed state agencies to drastically reduce emissions by 2035. This is part of Oregon's plan to cut climate-warming emissions 50% by 2035 and 90% by 2050.

This timeline allows for the continued build out of the electric vehicle charging infrastructure. The state already has a robust Tesla charging network. The other networks have had reliability issues. A 2035 timeline allows these to be ironed out by early adopters (hopefully sooner rather than later).

How Big Of A Car Market Is This? 

California is the top region for automotive sales in the US. As of 2021, car sales in California was $137 billion and accounts for ~12% of US car sales. Add Oregon's $13B and Washington's $21B and that brings you to $172B market or 15% market share. This is obviously far too big of a market for automakers to just walk away. They will need a robust EV line-up.

What About The Other CARB States?

Massachusetts and New York have also adopted similar rules. These five states together account for almost a quarter of the U.S. population. This is adding more fuel to the fire to stop burning fossil fuels (pardon the anachronism).

There are 17 states that have announced intentions to follow California's vehicle emissions standards to one level or another. These states are New York, Massachusetts, Vermont, Maine, Pennsylvania, Connecticut, Rhode Island, Washington, Oregon, New Jersey, Maryland, Delaware, Colorado, Minnesota, Nevada, Virginia, and New Mexico. Four of these have already vowed to follow the 2035 ban. How many more will soon follow? Colorado, I'm looking at you to join next.

Ω

Powerwalls and Power Outages

Look at the map above. This is the region where I live. More than 55 thousand people here are currently without power right now. We had an Arctic blast blow through with snow and ice last week and this week there's a wind storm taking out branches and trees. To pile on to all of that, there's domestic terrorist movement that somehow thinks that attacking electrical substations will manifest their extremist political agenda.

Tesla Powerwalls don't have a "grid under attack" setting (yet). 

There's no good time to lose power, but during a winter storm is the worst. Without power, you cannot run your furnace to stay warm. This is true even if you have a gas furnace because power is needed to run the fans and control systems. If you opt to evacuate to stay with friends or family or to check into a hotel, the road conditions can make travel difficult. These storms and outages can be deadly.

Powerwall to the rescue

So here we are with our Powerwall full and the lights flickering occasionally. We are getting a meager amount of solar production on this rainy winter's day. Even with a small amount of solar production, this can stretch the battery uptime significantly. 

Here's something that many people without solar on their roof don't know. If you have solar without batteries (the most common type of solar installation), when the grid goes down, your solar turns off. This seems like the time when you'd need it most, but there are a couple of reasons it works this way. It's unlikely that your solar will create exactly the amount of power that your home needs. If it doesn't make enough, you'll brownout your home and could damage your more sensitive equipment (computers, TVs...). If your solar makes more than your home currently needs, it has to go somewhere. This would usually be the grid, but if the grid is down, it can't go that way.

This is where Powerwall comes in handy. Even when the grid is down, it can fill in the passing cloud  gaps and prevent the brownout that might fry your flat screen and it can absorb the surplus for use after the sun goes down.

A distributed power grid is more resilient and a harder target for weather or violent extremists to attack.

Solstice, Storms, & Solar - Tesla Powerwall: StormWatch vs VPP

The winter solstice is a milestone day in solar energy. It's the shortest day of the year, so nothing but longer days from here for the next 6 months.

Usually for the solstice, I note our solar production, sunrise, sunset... I'll cover that, but something unexpected happened on the solstice this year. 

Winter Storm Event
Red Flag Warning

Unstoppable Meets Immovable

Like much of North America, our area is currently being hit by snow and ice storms during this yuletide. In response to the storm, on the solstice, two things happened. One, at 4PM our Tesla Powerwall went into Storm Watch mode. This charges it up to 100% and keeps it there so the battery pack has the energy needed to keep our home running if the grid power goes out. An outage is a real possibility during ice storms, so the precaution is smart. The second event in response to the storm is that our local utility scheduled a virtual power plant (VPP) event. The VPP event was scheduled to run from 5PM till 8PM. 

Portland General VPP event

So what happens when Storm Watch mode is trying to hold the pack at 100% charge and a VPP event is trying to discharge the battery to support the grid? The good news is we could to opt-out of either one or both of the events if we had a preference as to which one we wanted to win out. However, I was far more curious to see what happened if we did nothing and watched the result. 

Without further ado, the VPP won out. Our Powerwalls discharged for 3 hours at 3kW. This removed 9kWh from our ~40kWh pack.

Powerwall Discharging 
While in Storm Watch Mode

Solstice Energy Use and Production

Below is the graph of our energy use on the solstice. The colors tell you the source: grey is the grid, green is the Powerwall, and amber is solar direct from our roof.  

The sun didn't spend long in the sky on December 21st. Sunrise was at 7:47AM and sunset was at 4:29PM. That's just 8 hours and 42 minutes without the cold inky black winter sky overhead. Combine this with the sun low in the sky and storm clouds and the result is a yield of 12.7kWh of solar production for the day. 10.5kWh of that solar went directly into running our home with the remaining 2.2kWh going into the Powerwalls. 

For comparison, on the summer solstice, we generated 72.9kWh (almost 6 times more), along with feeding ~50kWh of that into the grid. Here's looking forward to sunnier days.
Ω

Other Solar Posts: 

Saving Money with Solar

Charging an EV with Solar Panels

Other Powerwall Posts:

Batteries Make Everything Great About Solar Even Better

Everything You Want To Know About Tesla Powerwalls

Portland Virtual Power Plant

Tesla Semi: Another "Impossible" Achievement

Tesla Semi Exploded View at Production Release Customer

Tesla has done things that were once considered impossible. They made the Roadster when EVs were regarded as slow golf carts or milk floats. The zippy roadster was fast and fun and could blow the doors off cars costing ten times as much. This was the first of Tesla's "impossible" achievements and they've had a string of them. 

Tesla's Semi is the latest of their impossible achievements. 

Why Electric Class-8 Semi-Trucks are 'Almost' Impossible

Making an electric long-haul semi is not easy. It takes a lot of energy to move thousands of pounds/kilos of load. For an EV, that energy is stored in batteries. Adding more batteries adds more energy storage, but it also adds more weight, requiring yet more energy. This negative feedback recursion has led some to say that it is not possible, even with "big breakthroughs." As you can see below, one of these nay-sayers was Bill Gates.

Bill should understand that the march of progress opens new doors. He seems to be stuck in 1990s battery technology thinking. Even before Tesla's semi came out, there were class 8 trucks from Volvo, Freightliner, Kenworth, Peterbilt, and others (see table below). These non-Tesla class 8 vehicles generally had less than 350 miles of range, but it was a start; a foundation to build upon. 

Gates is not the only one to have doubts, Daimler Trucks CEO Martin Daum has commented, "if the claims Tesla is making about its electric semi-truck are true, they are breaking the laws of physics." Gates and Daum seem to be confusing 'what has been done' for 'all that can ever be done.' 

Tesla improved the aerodynamics, they improved the drivetrain, they improved the battery technologies, and they achieved what Gates thought impossible.

As we discussed in this article, Musk and Co. focus on the Class ½ Impossibilities. These are the things that are physically possible but at the edge of our technical know-how. Class ½ Impossibilities have just been enabled by technological advances, either directly or by advances in tangential areas that can be applied with other optimizations. These are not easy to achieve, they require breakthroughs, optimizations, hard work, and some luck. When completed, these enable something that we've never seen before and therefore something which many people will say is impossible. 
 

An Elephant That Moves Like A Cheetah 

The Tesla Semi has three Tesla carbon-wrapped Plaid motors. Musk described the vehicle as a beast. He said it's a giant Semi, but unladen, it moves like a sports car. He went on to say, "It's like watching an elephant move like a cheetah."

Tesla's "Impossible" Achievements  

One Roadster: When Tesla started, the founders often heard things like, "This is a fool's errand. Nobody wants an EV. They are slow, there's nowhere to charge them."

The Roadster showed that EVs can be sexy and fast. In the quarter mile, this electric car would blow away gas cars costing 10 times as much. It changed the perception of EVs. But the nay-saying continued, "A few Silicon Valley millionaires and billionaires will buy them, but no one else is interested (or can afford) an EV." 

Two Model S: The Model S disproved the "only in Silicon Valley" narrative. Tesla had sales around the world. 

Three Supercharging: Tesla's Supercharger network is impressive. There are currently more than 40,000 Superchargers installed around the world. These have high availability and locations near major travel corridors. This is vital infrastructure for electrified transportation.

Four Energy Storage: Vehicles are just part of Tesla's business. Tesla's Megapacks have 3.9MWh of capacity. This is enough run the average home for over 130 days. Gang these together and you can make an impressive installation like the 730MWh Elkhorn Battery Energy Storage System in California or the 600MWh Arroyo Solar Energy Storage in New Mexico. As I write this in late 2022, Tesla has 5GWh of Megapacks and Powerpacks installed or under construction. 

Before we had significant energy storage, the amount of renewable energy that could be placed on the grid was limited. The legacy fossil fuel generation of the grid could not handle the fluctuations that wind and solar caused. However, with renewable sources buffered behind a battery pack, all of those fluctuations are washed away. The grid, instead see a steady, adjustable rate from the batteries that can be dialed up or down in milliseconds to support the grid exactly as it needs, exactly when it needs. 

Tesla's semi is the most recent on this list, but it won't be the last.  

This is The Beginning - Commence Iteration 

As impressive as the Tesla Semi is, this is just the beginning. As we saw with the Model S, a decade from now the Tesla Semi will be much improved. It will go from just a day cab to a sleeper cab. The range will grow from 500 miles to over 750 miles. The recharge times will improve. And the software will improve. 

The in-cab entertainment options will improve (will the sleeper bunk have a video game / movie screen)? Software integration for load pick-up, delivery, and schedule will improve; reducing the number of running empty deadheading trips. 

Wrapping It Up

The Tesla Semi is an important milestone. The fuel cost savings will drive fleet managers to adopt electric semis. Tesla's semi has limitations today on range and load weight, but innovation is Tesla's life's blood. Currently, it is perfect for many day-use loads. As the vehicle improves, the number of drives it's suited for will increase, until the range and refuling times rival and surpass Diesel semis. 

How Big Is The Tesla Semi-Truck Battery Pack?

Tesla delivered the first of their semi-trucks to a customer last night. The Pepsi / FritoLay company was the lucky customer. We learned a lot about the vehicle's capabilities in the presentation, but one thing we didn't learn is the size (energy capacity) of the battery pack. 

In this entry, we'll use what we know about the battery to put upper and lower bounds on the capacity and infer a likely size. If you don't want to read to the end, our current estimate for the size of the battery pack in the Tesla Semi is 914kWh usable. Read on if you'd like to know how we came to this conclusion. 

We know the cells are produced at Giga Nevada and, given the hauling use case, they are likely the high-Nickel chemistry that was developed in partnership with Panasonic. 

Tesla has said that the semi (fully loaded) has an efficiency better than 2kWh per mile. Additionally, the semi recently completed a fully loaded 500-mile drive. 

Using these two numbers gives us a 1000kWh (1GWh) capacity estimate, but there's more to the story. 

Taking a close look at the drive above, you can see that it started with 97% charge and ended with a 4% charge; so if you were doing a true 100 to zero percent trip, you'd have another 7% of capacity to use. That would be a 537-mile range, at 2kWh per mile, the upper bound for the pack size is 1,075kWh. 

As Musk often does, he gave us more info on Twitter. Specifically, he said that the current efficiency of the semi is 1.7kWh per mile. Another digit of precision would be nice, but we'll go with this for now. 

Recalculating using this number and the 500-mile trip yields an 850 kWh battery. Using the inferred 537-mile trip would use a 914kWh capacity battery pack usable.

In battery-powered electric vehicles, there's usually some reserve capacity that's locked away from the driver's use. This helps extend the battery lifespan. If we assume a 6% reserve, this adds another 55 kWhs to the pack, bringing the total pack size to 969kWh.

A 1.7kWh/mile efficiency is the energy equivalent of about 20 miles per gallon (20 MPGe while hauling a full load). For a comparison, with a full load, Diesel class 8 semi-trucks average about 6 MPG. The most efficient Diesels semis out there (the Freightliner Cascadia Evolution) gets 10 MPG on a good day. So the Tesla Semi has a fuel efficiency that's triple the average (and double the best), compared to Diesel semi-trucks.

Today, semis are primarily Diesel-powered. Electrifying semi-trucks is very important. In the US, they are only about 1% of vehicles on the roads, but they have a very outsized pollution impact; they generate about 20% of vehicle emissions and about 36% of particulate emissions. This directly has an impact on health and air quality. Semi-trucks from Tesla, Freightliner, BMW, and others will help make a cleaner world. 

EVs On Brink of Mass Adoption

The electric vehicle adoption rate continues to climb. So far in 2022, nearly 7 million plug-in vehicles have been sold. This is more than 2019 and 2020 sales combined. EVs have now reached a 13% share of new car sales. Add plug-in hybrid sales to this and CarsWithCords have a 17% global share.

Source: Guinness Global Investors

A 17% share is significant. The upward curve signals that 2023 will likely exceed its predecessor by ~50%. Seventeen percent is important because it shows that EV sales have crossed the chasm of the technology adoption curve. The tipping point is at hand.

Technologies defuse into society in a predictable manner, following an adoption curve. As you can see above, the technology adoption curve splits the market up into 5 major groups based on their willingness to buy products in new categories. This curve applies to modern technologies such as smartphones, computers, and the internet but it also applies to older technologies such as telephones, electricity, and washing machines.

Early in a product's lifecycle, they are often cumbersome and difficult to use. This means only the most determined among us are willing to invest the time and mental energy needed to use these products. Slowly, improvements are made resulting in products that are easier to use and more affordable, so more people adopt them, moving further along the curve.

This generation of EVs started with the Chevy Volt and Nissan Leaf in December 2010. Back then EV ranges were short, prices were high, and charging infrastructure was scarce. Now, over a decade later and infrastructure has proliferated, ranges have increased, and prices have come down some. Increasing gasoline prices and government policies have also not hurt EV adoption. This has allowed EVs to move from the tech enthusiasts group into the early adopters group. 

Collectively, tech enthusiasts and early adopters form the early market. Sadly, many products never break out of the early market 16% segment. They remain niche products and never move into the mainstream. This gap between the early market and the mainstream market is known as The Chasm. Crossing the chasm is the difference between having a small enthusiastic following or changing the way that society functions. Consider the difference between ham radio and smartphones; you can communicate with either one, but they are at very different places on the adoption curve. 

Globally, EVs are on a course to cleanly jump the chasm with room to spare in 2023. This is something that hybrid vehicles have never been able to do. Entering the mainstream market means that economies of scale (see Wright's Law) begin to kick in, further reducing the costs and further increasing market adoption, creating positive feedback. 

Conversely, this means the legacy product lines that are being displaced suffer shrinking market share. This drives up their costs as lines are shut down and fixed costs are amortized over a smaller number of units. This further makes the choice of the newer product more practical; allowing the next segment of the late majority to follow the early majority. 

In 2014, we made the prediction that EVs would cross the chasm in the mid-2020s. It certainly appears that this will be the case for China next year and the rest of the world will soon be following. This will be fun to watch over the remainder of this decade and into the next.

fin

Why Tesla's Charging Network Should Become Everybody's

Tesla has changed their charging platform from a proprietary system to a standard system. This is exactly what we asked for in the article below back in 2017. In the original story, we looked at the capabilities and networks of each of the North American charging systems. Based on this review, we concluded that Tesla's charging system was the most robust and functional and we made the seemingly implausible assertion that all automakers should adopt Tesla's charging system. Well, a major step towards that goal has just occurred: Tesla will allow other charging networks and other automakers to use Tesla's charging connectors, ports, and network. 

Below is the article from May 1st, 2017. 

---

The fractured fast charging market: CHAdeMO, Tesla, SAE Combo (CCS) 
image via chargedevs.com

Charging is an important part of the EV ownership experience. If you have a living situation that allows for it, charging up at home is very convenient. It only takes seconds to plug in and your car starts out each morning fully charged, ready to take on the day. When you're on a road trip, things are different. You have to use the public charging network to fill up and keep rolling. This could be charging overnight at a hotel or roadside fast charging.

Up to this point in time EVs have been less than 1% of new vehicle sales. This means that they have been purchased by the portion of the market that is the most enthusiastic about the technology. These early adopters have generally been content (perhaps even excited) to hunt for charging stations and to mold their drives around the available infrastructure. As EVs move to mass adoption, this tolerance quickly fades; it will be important to have a vast, easy-to-use, reliable, fast charging network.

When considering public EV charging network infrastructure, you must look at several factors (speed, reliability, availability, access, usability...). Looking at the three fast charge networks (CHAdeMO, CCS, and Tesla), considering all of these factors, in our previous post we concluded that (although there is room for improvement) Tesla is the only charging provider that is currently offering a robust positive charging experience. Tesla has well-positioned charging sites; no membership sign-in, apps, or cards are required to initiate a session; there are multiple stations per location; the stations are fast and operational; and there is usually no waiting (at most locations).

Tesla has offered to allow other automakers to use their network. In 2015, Elon Musk said, “Our Supercharger network is not intended to be a walled garden. It’s intended to be available to other manufacturers if they’d like to use it. The only requirements are that the cars must be able to take the power output of our Superchargers, and then just pay whatever their proportion their usage is of the system.” This statement from Musk is aligned with Tesla's goal to accelerate the advent of electric transport (not just Tesla's cars).

To date, no automakers (that I am aware of) have taken Musk up on this offer. Should they? Below we'll explore what this partnership might look like.

Porsche's proposed 800-Volt fast charger

Proprietary Versus Standard(s)

Which fast charging type to choose?

If you were the head of a new EV program at a car company (such as one of the many new EV startups or a conventional car company getting into the EV market), you would have to determine which of the fast charging solutions you would choose for your upcoming line of EVs. The options are:

1. Design your own proprietary solution
2. Select the Japanese standard (CHAdeMO)
3. Select the SAE standard (CCS)
4. Partner with Tesla

Proprietary Solution

Option 1 has several drawbacks. It has a large capital requirement. You would need to build out a vast network in all regions where you sell vehicles. It's a multi-year effort. Porsche has stated that they have engineered an 800 Volt fast charging system. If Porsche were to deploy yet another network, this would further splinter the industry. Porsche has a great record of innovation, they would be better off working with one of the groups in options 2, 3, or 4 to improve charging for all. Considering the cost and effort, let's consider this a DOA option, listed only for completeness.

Standards-Based Fast Charging (CHAdeMO/CCS)

Option 2 or 3 utilize existing public networks. This is what most non-Tesla automakers are selecting. Here it is important that you consider the experience that your owners will be subjected to. Simply selecting a CHAdeMO or CCS port for the car and then saying "fueling infrastructure is someone else's problem" is a poor option. Automakers must become involved with the charging standard organizations. This should include investments into the infrastructure network, in the charging provider companies (AeroVironment, ChargePoint, ABB,...), and perhaps even a seat on their board promoting reliability and a positive driver experience.

           

Automakers cannot simply put a fast-charge port on their cars and call it done. The charging networks that support these vehicles and their customers are an important part of the ownership experience.

As we covered here, CHAdeMO seems to be losing steam. If you are considering this option, CCS looks like the better long-term choice. However, there is one more option to consider first.

The Tesla Network

Option 4 is to partner with Tesla. Let's continue with our analogy that you are in charge of a car company's new EV program. Should you partner with Tesla or select CCS? Let's assume you've decided to partner with Tesla. For the rest of this article, we'll explore this option.

Justification: Why Automakers Should Take Up Tesla's Offer

Compared to CHAdeMO or CCS, Tesla's network is more complete, robust, and reliable. The network is better planned and positioned, there are multiple stations per site, and no membership card or app is needed to initiate a session. As an EV driver, it is a better experience.

Selecting Tesla would give your fledgling EV program an incredible jumpstart and your EV program an incredible innovation partner. This will keep your vehicle's charging technologies on the leading edge. Tesla has announced plans to vastly increase the charging rate of their network in 2017 with Supercharger V3. They also plan to install solar canopies and onsite energy storage. If you are hoping to attract environmentally conscious customers, these (soon to be solar powered) charging stations are a compelling story.

How Would A Partnership Work?

Since no automaker has yet taken Tesla up on this offer, we don't know exactly how it would work but Tesla has laid out some of the framework. Musk has stated that the contribution to the Supercharger network would need to be proportional to use of the network. So, if your company's cars make up 5% of the network's use, your company would need to pay Tesla for 5% of the network's operating cost.

Considering the recent changes Tesla has made for idling fees and limited free charging, I'm sure that Tesla would require similar fees for other automaker's vehicles joining the network. These changes were not profit motivated, they were intended to improve network availability. Any car that is blocking a spot is a problem, regardless of the brand, so these rules would likely apply to partner company vehicles too.

As a partner, fees above and beyond the Tesla minimums would be at your discretion. Tesla has said that they are not trying to make a profit from the charging network. However, other automakers would be free to try other models. The fees collected, if any, could be used to offset the payments for your company's portion of the network operating cost.

Additionally, if your company established charging stations and added them to the Tesla network, the Tesla owner attendance could additionally offset the use of your vehicles on the Tesla network. Having this as an option is nice. If the EV project at your company is small, the network use will also be small and the payments to support the network would be negligible. If, however, the fledgling EV program at your company flourishes, then establishing your own Tesla-compatible charging stations in high-use areas can offset the charging events by your cars at Tesla branded superchargers.

Competing?

If your car company is using Tesla Supercharger stations, would your vehicles be seen as competing with Tesla vehicles? Yes. If you are building a long-range electric vehicle, then your car is competing with Tesla, whether or not you are using their network.

Partnering with Tesla on charging standards puts you on equal grounds in this arena. This means you will need to make compelling vehicles.

Overcrowding

There has been overcrowding at some Supercharger locations in California and Norway. Tesla is actively installing and expanding their network. More locations will only help if the network growth outpaces new vehicle sales. Tesla has a large number of Model 3 pre-orders. They plan to deliver a lot of cars in 2017 and 2018. Overcrowding is a risk. The changes Tesla has recently made to eliminate free supercharging and to add an idle fee are steps to ensure that the network is not abused and only used when it is needed. Additionally, doubling the network size in 2017 to alleviate congested areas. We'll see if these measures help.

The Choice Is Yours

Which "little monster" (as ChargePoint called them) will you choose? If you are a car buyer, this choice will impact where you can charge. If you are an automaker, this choice (among many others) can determine if your sales continue to grow, or if they flatline.